Professor Keith Ewing from London University argues that Australia and the United Kingdom are two countries with a lot in common – severely compromised workplace rights.

Both have elected labour governments after a long period of conservative rule in which workplace rights had been greatly eroded. Eighteen years in our case; twelve in yours. In our case the blows were cushioned to some extent by our membership of the European Union, though the impact is probably marginal. In the case of the United Kingdom, eighteen years of Tory government had seen a collapse of regulation and regulatory institutions.

Both of our countries have elected labour governments promising to restore fairness at work. We too have a seminal publication in 1998 called Fairness at Work. But at the time no one paid enough attention to the detail, and no one took seriously enough the constraints around which government proposals were wrapped. But it was there for all to see, if only we had looked more carefully.

According to Tony Blair:

“The White Paper steers a way between the absence of minimum standards of protection at the workplace, and a return to the laws of the past. It is based on the rights of the individual, whether exercised on their own or with others, as a matter of their choice. It matches rights and responsibilities. It seeks to draw a line under the issue of industrial relations law.

There will be no going back. The days of strikes without ballots, mass picketing, closed shops and secondary action are over. Even after the changes we propose, Britain will have the most lightly regulated labour market of any leading economy in the world. But it cannot be just to deny British citizens basic canons of fairness – rights to claim unfair dismissal, rights against discrimination for making a free choice of being a union member, rights to unpaid parental leave – that are a matter of course elsewhere.

These proposals, together with the introduction of a minimum wage – set sensibly implemented sensibly – put a very minimum infrastructure of decency and fairness around people in the workplace. They have been extensively consulted upon with business and industry. They offer the right way forward for the future…

The three pillars of our industrial policy are the pursuit of strong markets, modern companies and the creation of an enterprise economy. This White Paper sets out a framework for the second of these aims and, in so doing, the foundation for the third.”

(Fairness at Work, Cm 3968, 1998)

Trade Union Recognition Procedure

We have a third thing in common – newly elected governments committed to a recognition strategy. Statutory recognition procedure was introduced in 2000 to help trade unions to secure recognition for the purposes of collective bargaining. Detailed and complex procedure:

  • Applies where union can show initial demonstration of support (10% membership plus likelihood of majority support) in an agreed or determined bargaining unit.
  • After this initial phase, the parties have to agree to the bargaining unit. The union does not get to choose who it will represent: the bargaining unit must be compatible with effective management.
  • Union must then establish that it has majority support for recognition in the agreed or imposed bargaining unit. This may be done by a secret ballot or by evidence of membership.
  • Where a ballot is required, union must secure 40% of eligible votes plus a majority of those voting; ballot may be required in some cases where union has majority membership.
  • Unions granted statutory right of access to the workplace to solicit support from the workforce, and to hold meetings in working time with workers to be balloted.
  • Bargaining rights apply only to wages, hours and holidays, though once recognised a trade union then acquires a number of consultation rights – eg: in the case of business transfers or redundancy.
  • If an application fails, the union cannot bring back a complaint against the same employer for a period of three years in respect of the same bargaining unit (even though composition may have changed).
  • Conduct of employer regulated by statute – now duties to cooperate with process, and also an unfair labour practice to engage in various forms of anti-union activity.
  • Process administered by quasi judicial (tripartite) tribunal (Central Arbitration Committee).

But the recognition procedure is beset with problems and has a number of defects:

  • It does not apply to small businesses, taking out about 20% of the working population, even though some microbusinesses in some sectors do recognise trade unions.
  • It does not apply where the employer negotiates voluntarily an agreement with a non-independent union which the employer has established or with an independent union which is not representative of nor wanted by the workforce.
  • It allows various opportunities for employers to contest the union’s application: the appropriate bargaining unit, the claim that the union has majority support, insisting on a ballot.
  • It fails to deal with unfair conduct by employers at an early stage in the recognition process, as the union is trying to nurture its support. Various forms of employer conduct were identified in evidence by British print and media union to a House of Commons Select Committee in 2004:
    • The threat of closure of the plant/business or part of it, if the union gets recognition including moving work to another part of the country or to another country
    • Individual job loss threats
    • Actual sacking of trade union representatives and activists
    • Pay and promotion inducements for those who denounce the union either openly or working against the union or simply by not joining
    • Holding a company ballot in advance of an independently conducted ballot
    • Complete denial of any access to a union including preventing leaflets being given to the employees
    • Holding anti-union meetings at the workplace
    • One on one meetings, lead by supervisors who are given the task of breaking union organisation in their department, sometimes with their own employment under threat
    • Proposing changing to the bargaining unit—either splitting it or combining with it with others of different trades
  • Other tactics include the formation of staff associations, the disruption, infiltration and surveillance of union meetings, and the use of misleading and provocative propaganda about the union and its officials, in some cases exploiting vulnerable workers.
  • Certain unfair labour practices now unlawful and actionable by the union, but they are too limited in scope – they expressly authorise partisan activity by he employer, they apply only during the ballot period, and the Central Arbitration Committee (CAC) takes a narrow view of what constitutes ‘undue influence’ by the employer.

As a result of these problems, the recognition procedure is no panacea for the problems of trade unionism:

  • After only eight years in operation, the number of complaints to the CAC has declined to a trickle, with only sixty-four cases referred in 2007-08, with an average bargaining unit of only 119. Tiny compared to the nature and scale of the bargaining deficit.
  • More seriously for trade unions, collective bargaining density has actually declined since 1997, and now stands at only 33.5% of the labour force, and only 19.6% in the private sector, though 69% in the public sector. That is a decline of 36% since 1997.
  • But although it is no panacea, a significant number of people have, however, benefited from the procedure, which has probably helped as a parachute to slow down decline rather than arrest it, though even here the benefits have been contested.

The number of workers benefiting directly from the statutory recognition machinery has been small. Cases of recognition awards by the CAC (either through balloting or membership audits) or through CAC applications being used to solicit voluntary agreements have, since June 2000, numbered just 216, covering around 100,000 workers. By contrast, the number of entirely voluntary deals has been just over 1900, covering around one million workers. Of course, many of these agreements would have been far more difficult to gain without the presence of the statutory procedure but they owe as much, if not more, to the efforts of the unions under the project of ‘union organising’ as they do to the introduction of statutory recognition. (Hendy and Gall, ‘Workers’ Rights Today and the Trade Union Freedom Bill’,

  • The defects in the procedure have led the TUC to raise with the ILO concerns that the procedure may not meet ILO standards, on the small business exemption, staff associations, unfair labour practices, and the absence of bargaining rights for members where the union does not have majority support.
Lessons from the British Experience

Are there any lessons to be learned from the British experience? How could we have done better?

1. The question of government commitment: that is to say, unequivocal courage and support, which was not forthcoming. Recognition was a manifesto promise in 1997, but the government was awkward and defensive about it. British unions were to face the paradox of mobilisation and marginalization. In the United Kingdom, trade unions have been crucial to the electoral success of three labour governments. But having been mobilized for money and resources trade unions have been marginalized and treated with contempt, to such an extent that the mild mannered General Secretary of the TUC could be heard to complain of being stuck in a corner like an embarrassing elderly relative. Compare the position of Barack Obama who on 2 April, 2008 spoke to the AFL-CIO of “build[ing] an America where labor is on the rise”. In the same speech, he said:

“We’re ready to play offense for organized labor. It’s time we had a President who didn’t choke saying the word “union”.  A President who knows it’s the Department of Labor and not the Department of Management. And a President who strengthens our unions by letting them do what they do best – organize our workers. If a majority of workers want a union, they should get a union. It’s that simple. Let’s stand up to the business lobby that’s been getting their friends in Washington to block card check. I’ve fought to pass the Employee Free Choice Act in the Senate. And I will make it the law of the land when I’m President of the United States of America.”

Well let’s see what happens, with the press already reporting that US business is mobilising against the legislation, with President of the Business Roundtable expressing concern that “the law would really change the dynamics of how companies will be able to compensate employees in a way that also preserves the interests of shareholders” (Financial Times, 7 November 2008). Unequivocal government support is especially important to resist the political power of employers who will seek to use the political and parliamentary stages to lobby to dilute the legislation, to secure concessions of three kinds: to carve out exclusions from the coverage of the legislation; to make it easier for employers to resist it; and to make it harder for unions to use it. In our case, these illustrated by the following:

  • The exemption for small businesses so that the legislation does not apply where the employer has fewer than twenty-one workers. At a stroke of the draftsman’s pen, some five million workers are cut out from the procedure for no apparent reason.
  • The provision that prevents a union from making a claim for recognition where the employer voluntarily recognises a trade union, even though the union in question is not independent. This allows for the legitimate use of sweetheart organisations as a legally sanctioned avoidance strategy.
  • The discretion on the part of the adjudicator that a ballot can be ordered even where the union has demonstrated that it has a majority in membership. This allows the employer to campaign aggressively to undermine the union in the ballot.

2. The question of employer conduct – we were naïve: we thought that access would be enough and that reason would prevail. We did not do enough to learn how employers respond to this kind of legislation in other countries and we did not press hard enough for legislation that fully anticipated these activities. We made a mistake in thinking that British employers are different, and that US practices would not come to the UK. Well that was wrong. Expect the strongest resistance from employers, and anticipate employer attempts to control of the process. Companies big and small have very quickly tried to (and most cases have succeeded) to contain the procedure in a number of ways. International companies like Amazon,T Mobile, Cable and Wireless, and GE Caledonian, as well as smaller companies (like Kettle’s Crisps) controlled by private equity, and the owners of local newspapers:

  • Prevented the build-up of worker support – pre-emptive ballots, alternative forms of workplace organisation, employer creation of union (though rare); and employer selection of union.
  • Undermined support where it has been established – inducements in the form of higher pay and better conditions; threats in terms of relocation, closure and redundancy; surveillance and infiltration of union activity; action in the forms of dismissal.
  • Manipulated the legal process – challenging union claims about membership and support; challenging the union’s proposed bargaining unit; forcing a ballot even where union has majority membership. Some cases are pushed to as many as five or six decisions, delay being the enemy for trade unions.

We failed also to confront the problem of union-busting US consultants, who advise employers on how to remain union free, whose activities were completely under-estimated, despite a report in the press in 2000 that London law firm Eversheds had introduced Texan consultants to its British clients, some of whom were American multinationals. Those invited were said to include McDonalds, Dow Chemical and Bristol Myers Squibb (The Observer, 4 June 2000). The most high profile of these bodies is The Burke Group (TBG) which has been active in the UK, advising employers in a number of high profile cases.

“In the most recent case involving Cable and Wireless (which the union lost despite having 56% membership), the CAC panel said that it ‘shares the union’s concerns about TBG’s unfortunate track record, according to union and academic sources’. TBG complained and the Chairman of the CAC forced the panel to re-issue its decision with the offending passage replaced to read that ‘TBG is alleged by the union to have an unfortunate track record’. The TBG chairman was said to be ‘happy’ with the committee’s decision”. Daily Telegraph, 3 August 2008

We also failed to confront their friends in the international law firms. Go on the websites of the big firms, working from New York, London and Hong Kong. On one page they will boast of their pro bono work and their commitment to human rights, of which they are right to be proud. On another page they will boast about how they act on behalf of Fortune 500 firms to help them remain union free and how they give aggressive representation in labour disputes, about which not everyone will feel they should be so proud.

3. The question of legal context – whatever their content, recognition laws are not enough on their own to enhance collective bargaining: they are not a solution but an integral part of a strategy for addressing the problem. As such recognition laws need to be supported from below and above if they are to be truly effective:

  • Support from below in the sense of being the final stage in a framework that gives (i) all workers the right to be represented individually or collectively by a trade union on all matters relating to their employment, (ii) in which representative unions have the right to be consulted about major issues affecting their members; and (iii) which empowers unions representing a majority of workers in a bargaining unit have the right to represent the unit as a whole and to make agreements that cover the unit as a whole. The strategy must give workers security about their union membership and trade unions incentives to establish, consolidate, and build up their presence in the enterprise. Equally important, it must undermine employer resistance by meeting ILO minimum standards, which emphasise the right to unions to bargain collectively on behalf of their members, even if they do not have a majority in the bargaining unit.
  • Support from above in the sense that an effective collective bargaining strategy requires a strong commitment to sectoral or industry-wide bargaining, as well as initiatives addressed to the enterprise. No major economy with de-centralised collective bargaining at enterprise level underpinned by recognition laws has a collective bargaining density of more than 50%. This would be true of the United States, Canada, and Japan, as well as the UK. In contrast, countries with higher levels of bargaining have higher levels of collective bargaining coverage. There is no major economy that has sectoral bargaining where there is collective bargaining coverage of less than 70%. Collective bargaining density is tied closely to the level at which it is conducted. Enterprise bargaining and the organising model by which it is underpinned is extraordinarily resource intensive and difficult to sustain and maintain in hostile conditions.
  • So, a recognition procedure in the UK that is beset with problems and is no panacea for trade unions. And, an effective system of workplace representation needs political courage to confront the conduct of employers, and to cement the procedure in the context of an overall framework of reform. Our system has failed trade unions because the Blair Government lacked courage to resist the demands of employers, a weakness reflected in the lack of effective measures to deal with the conduct of hostile employers (even after reforms in 2004), and lacked adequate context.
  • But the circumstances have now changed. Trade unions have an unprecedented opportunity to seize the initiative. The politics have been transformed by three closely related developments: the global credit crunch, the collapse of confidence in neo-liberalism, and the American presidential election result on 4 November, 2008. The economics have been equally transformed for the same reasons, but also because in many countries public money – taxpayers’ money – is being used to prop up a failing global economy.
  • When the world was last in a recession on this scale, the British government of the day – a conservative government – under the influence of the Liberal economist working in the Treasury – one J M Keynes – undertook to support the re-building of collective bargaining, so that within a period of twelve years, 85% of British workers were covered by collective agreements. This was presumably to create a virtuous cycle of (i) higher wages and greater spending power, (ii) to stimulate demand and production to meet the demand, (iii) to stimulate employment growth.
  • It is supreme irony that the challenge for the Labour government in Britain is to embrace the ideas of a Liberal economist and the politics of a conservative government. But as we struggle to find a new economic paradigm in an uncertain world, there is not only an opportunity but also a responsibility on the part of national governments in many parts of the world to intervene much more actively in economic management. We must ensure that it is not only in America where ‘labour is on the rise’.

Professor Keith Ewing, University of London